Ducera Partners

Last updated

Ducera Partners LLC
Company type Private
Industry Financial services
FoundedJune 2015;8 years ago (2015-06)
Founders
  • Michael Kramer
  • Derron Slonecker
  • Joshua Scherer
  • Adam Verost
Headquarters
Eleven Times Square, New York, U.S.
Key people
  • Michael Kramer (CEO)
Products
Number of employees
45 (2022)
Website www.ducerapartners.com

Ducera Partners (Ducera) is an American boutique investment bank that has a focus on advising companies regarding restructuring matters. Through its affiliate partners, it is also involved with wealth management and growth capital.

Contents

Headquartered in New York, it has additional offices in Los Angeles, San Francisco and Stamford.

Background

Origins at Perella Weinberg Partners

Michael Kramer, Derron Slonecker, Joshua Scherer and Adam Verost were all bankers who worked in the restructuring group of Perella Weinberg Partners (PWP). They became acquainted when they worked together at Houlihan Lokey in the past. Kramer joined PWP in 2007 after his restructuring firm, Kramer Capital Partners was acquired by it to build its restructuring practice. He was named founding head of PWP's restructuring group and was given a seat on the management committee. [1] [2] [3] [4] [5] [6]

By 2014, Kramer was dissatisfied with his treatment by PWP and felt he was not fairly given a leadership role despite the business he brought to it. Kramer had difficulty working within the firm's culture as well as its leader, Peter Weinberg as he came from a restructuring background that was more rough while the firm's leadership came from a traditional M&A background which was more genteel. Weinberg has stated no one in the partnership wanted to work with Kramer. Kramer realized his status within the firm was eroding after the firm failed to award him his expected compensation and stripped him of his titles while planning to replace him with one of his team members. [1] [2] [4]

In mid-February 2015 on Presidents' Day, Kramer, Slonecker, Scherer and Verost were all fired by voicemail. PWP stated they learnt of a meeting in January 2015 at Kramer's home in Connecticut eight members of the restructuring team gathered. Documents containing items related to starting a new firm which included a projected business plan were circulated there. Kramer claimed the meeting was called by junior members who were frustrated at PWP and that he did not solicit any team members to join him and any documents that suggested a new firm was not initiated by him. After Kramer and his colleagues were fired, four remaining members of the PWP restructuring team would late resign to join Kramer. In May 2015, Kramer and his fired colleague sued PWP for wrongful termination stating the firm manufactured reasons to fire them and cheat them out of about $60 million in deferred compensation. [1] [2] [4] [5] [6] [7] [8]

Ducera

In June 2015, Kramer and his colleagues who had been fired co-founded Ducera Partners, a restructuring focused investment bank. The name is derived from the Latin verb dūcere which means "to lead, to guide". [1] [3] [4] [5] [6] [7]

In October 2015, PWP issued a counterclaim claimed Ducera's co-founders had breached their contracts by colluding to form a new partnership. Rather than develop their firm from the ground up or pay for a complete practice by acquiring another firm, they decided to steal the practice group that PWP spent a lot of time and money developing. The lawsuit also sought damages caused by most of the team leaving resulting in lost business for PWP. While similar disputes were dealt with behind closed doors, this dispute was a rare instance of it spilling into public litigation which attracted attention from the media. Some bankers feared it would open an unwelcome discussion on non-compete clauses. In July 2016, the New York state court dismissed some of the compensation claims of Ducera's co-founders but allowed the case to move forward on allegations PWP interfered with their business prospects and defamed them [1] [4] [5] [7]

One of Ducera's earliest notable deals occurred in July 2015 when a group of Puerto Rico Government Development Bank bondholders hired Ducera to restructure $72 billion worth of debt. [3] [6] [9] Another one was when Ducera and Morgan Stanley were chosen to advise Monsanto on its sale to Bayer which was agreed on in September 2016 for US$66 billion. Ducera was stated to take in $50 million in fees from one of the largest deals in 2016 despite being only around a year old. [3] [6] [8] [10]

PWP has stated to its clients that they were not allowed to work with Ducera under any arrangement if they wish to continue doing business with it. Monsanto and Caesars Entertainment terminated their engagements with PWP. Silver Point Capital and Colt Defense have stated they wish to continue doing business with Ducera but PWP blocked them. [6] [8]

Business activities

Advisory

Ducera's main business line is providing investment banking advisory services mainly in restructuring. Some notable deals include:

Others

Ducera also is involved in other service lines through its affiliates. [13]

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References

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  2. 1 2 3 Basak, Sonali (October 23, 2015). "Here's How They Fight on Wall Street". www.bloomberg.com. Retrieved February 11, 2024.
  3. 1 2 3 4 "Meet the banker behind the biggest deal of 2016". Yahoo Finance. September 14, 2016. Retrieved February 11, 2024.
  4. 1 2 3 4 5 Merced, Michael J. de la (October 21, 2015). "Perella Weinberg Sues Former Partners Over Rival Venture". The New York Times. ISSN   0362-4331 . Retrieved February 11, 2024.
  5. 1 2 3 4 Jarzemsky, Matt (October 22, 2015). "Perella Weinberg, Departed Bankers File Dueling Lawsuits". WSJ. Retrieved February 11, 2024.
  6. 1 2 3 4 5 6 7 Weinman, Aaron (June 24, 2022). "Mike Kramer, who made his name battling bankrupt entities from Hertz to Puerto Rico, outlines the types of companies in greatest peril as inflation squeezes consumer spending". Business Insider. Retrieved February 11, 2024.
  7. 1 2 3 Dolmetsch, Chris (July 20, 2016). "Perella Weinberg Wins Ruling Narrowing Ex-Employees' Suit". www.bloomberg.com. Retrieved February 11, 2024.
  8. 1 2 3 Indap, Sujeet (July 30, 2017). "Clients caught in the crossfire when a star banker departs". www.ft.com. Retrieved February 11, 2024.
  9. ↑ Keller, Laura (July 17, 2015). "Puerto Rico Lenders Said to Hire Ducera Partners as Adviser". www.bloomberg.com. Retrieved February 11, 2024.
  10. ↑ Marino, Jon (May 23, 2016). "Meet the upstart bank that just took a piece of the biggest deal this year". CNBC. Retrieved February 11, 2024.
  11. ↑ Biswas, Soma (September 30, 2022). "Teen Retailer Rue21 Hires Adviser Ducera Partners After Earnings Drop". WSJ. Retrieved February 11, 2024.
  12. ↑ Berger, Paul (July 10, 2023). "Trucker Yellow Wins Reprieve from Lenders, Including U.S. Government". WSJ. Retrieved February 11, 2024.
  13. ↑ "Affiliations". Ducera Partners LLC. Retrieved February 11, 2024.
  14. ↑ "New York Investment Bank Ducera Invests in Cary Street's Parent". Wealth Management. August 13, 2019. Retrieved February 11, 2024.
  15. ↑ "Arcimoto Halts Production as Capital to Fund Operations Dwindles". Willamette Week. January 18, 2023. Retrieved February 11, 2024.
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